National Insurance Contributions (Employer Pensions Contributions) Bill

Debate between Lord Leigh of Hurley and Baroness Kramer

Committee stage
Tuesday 24th February 2026 Grand Committee

[Baroness Kramer (LD)]

My Lords, I made my views on this Bill fairly clear at Second Reading, so I am going to try to observe the discipline of not repeating my Second Reading speech. I am sure that I will not be absolutely 100% on that, but I am going to try.

I want to look first at this group of amendments. Amendments 1, 2, 14 and 15 put forward by the noble Baroness, Lady Neville-Rolfe, are particularly relevant because I do not think that at Second Reading we came away with a clear understanding that basic rate taxpayers were going to be significantly caught by the changes in this Bill. The focus on higher earners— I agree very much that we need “higher earners” to be properly defined—leaves us with a mistaken impression. I hope very much that the Government will provide some degree of clarity—the noble Baroness, Lady Coffey, called for the evidence—on who is impacted and how they are impacted. We ought to have that information in front of us. I will be troubled if this captures people on basic rate tax, given the pressures that they already face.

I would like to focus much more strongly on Amendments 3 and 16, because I do not think that at any point at Second Reading we addressed the impact on graduates repaying student loans and the impact on their take-home pay. I want to thank a gentleman called Tim Camfield who did some calculations and forwarded them to me because, as I worked through his calculations, it seemed to me that he had to be right. He wrote in the context of reading a response from the OBR to what I understand was an FOI in which it said that it did not believe that the Bill had any impact on student loans. It seems to me that very evidently it does and we need to know that. If the Government do not intend it and are going to have a workaround that will prevent it, then frankly we need to know that as well.

We all know that students have been under extraordinary pressure and that the Government openly have frozen the starting repayment threshold, but this, in effect, if Tim Camfield and others are right, would be a backdoor, further blow to this group. Whenever people say “student loans” and you are a Liberal Democrat, it is important to say—and I do not want to give a speech on our new policy—that my party recognises its role in creating the student loan repayment scheme. But frankly, the scheme is so changed, and graduates are under such pressure, that we now recognise that it is broken. I will not go through our policies—they are extensive—to completely reform that system.

I look now to the Minister to give us some real clarity, both on who is impacted and how extensively—how a normal person might read that as being an ordinary worker on a relatively modest income, rather than just a higher earner—and on the issue of student loans. I have some information on the distributional analysis that I will use in group 3 but, on the principle of trying not to repeat myself constantly, I will wait until then.

[Lord Leigh of Hurley (Con)]

My Lords, prompted as I am by my noble friend Lord Mackinlay, may I just take a moment to remind the Committee that I am a member by qualification of the Chartered Institute of Taxation and have received very helpful briefings from it?

Public Sector Productivity

Debate between Lord Leigh of Hurley and Baroness Kramer

Wednesday 7th January 2026 Lords Chamber

[Lord Leigh of Hurley (Con)]

My Lords—

[Baroness Kramer (LD)]

My Lords, this Question caused me to take a look at how the Government measure productivity. It strikes me as extraordinarily quantitative, taking into consideration almost no issue of quality. I am concerned that if AI is trained on these existing models, we are going to dig ourselves into a worse hole rather than make things better. Are the Government looking at how productivity is measured to give us something far more useful and valuable?

[Lord Livermore (Lab)]

I agree with a great deal of what the noble Baroness said. I noticed the noble Lord, Lord Leigh, who is very interested in this point as well, was on his feet. We have discussed it before in previous debates. We recognise the challenges in measuring public sector productivity, given the diversity of inputs and outputs in public services. The ONS recently published a review of its metrics. It has done a wide-ranging review into how productivity is measured and set out improvements that are now under way in many areas, such as healthcare, education and social security administration. It has included new quality adjustments, which better account for outcomes. I will take back to the Treasury the point the noble Baroness makes about the future adoption of AI.

National Insurance Contributions (Secondary Class 1 Contributions) Bill

Debate between Lord Leigh of Hurley and Baroness Kramer

3rd reading
Tuesday 4th March 2025 Lords Chamber

[Baroness Kramer (LD)]

My Lords, let me say to the noble Lord, Lord Eatwell, that I take full responsibility for the misdrafting of the original amendment, and for not being sensitive to the legal differences between Scotland and other parts of the United Kingdom. I thank my noble and learned friend Lord Wallace of Tankerness and the others who have supported him, and those in Scotland who were so concerned about what might happen to the care services there that they wanted to make sure that the language was reasonably perfected.

I am delighted to accept that amendment, but I am also very grateful that people came forward. It is good to know that we are sending something to the other place that is not holed beneath the waterline; I appreciate that. I also appreciate the vote that came in this House, which is not disrupted at all by this amendment, as people were very clear that they intended it to apply to Scotland as well as to the rest of the United Kingdom.

I hope that I will be in a position to thank the Government for accepting this tidying-up amendment, understanding the spirit both in which it was offered and in which the previous debate took place.

[Lord Leigh of Hurley (Con)]

I want to raise an objection to the earlier remarks of the noble Lord, Lord Eatwell, which accused us of making amendments to spray public funding around. We made a number of suggestions as to how government could raise revenue in other ways, and government does flex itself, as we have seen in the increasing defence expenditure and reduction in overseas aid, which is a perfectly reasonable thing to do outside of a Budget.

When the chief executive of a hospice says publicly that, as a result of this legislation, people may die in greater pain and agony than would otherwise be the case, I think it is perfectly reasonable for this to be drawn to your Lordships’ attention and for amendments to be discussed.

National Insurance Contributions (Secondary Class 1 Contributions) Bill

Debate between Lord Leigh of Hurley and Baroness Kramer

Committee stage
Wednesday 29th January 2025 Grand Committee

[Lord Leigh of Hurley (Con)]

My Lords, I think that I had reached the conclusion of my remarks, which is that I support these amendments. I particularly support impact assessments.

Before I sit down, I just make the comment that it is somewhat strange to note that we were voting on something in the Chamber of the House relating to boxes in the Royal Albert Hall, but we are deprived of the opportunity to vote on the matter of national insurance rises for every company in the UK. That seems to me to be somewhat absurd.

[Baroness Kramer (LD)]

My Lords, I stand as a winding speaker but also as someone who attached their name to Amendment 22 from the noble Lord, Lord Londesborough, which I think gets to the heart of the problem that we have with this Bill. To me, the most pernicious measure has been the dropping of the threshold, which has meant that trapped into employers’ national insurance contributions are the lowest paid and the part-timers. There is a disadvantageous impact on small businesses in hospitality and tourism, which are the backbone of so many communities and employ so many people for whom other work is very difficult to find. That makes it a really significant amendment, and I was very glad to attach my name.

I talked on an earlier set of amendments, essentially, about small businesses but also, more broadly, about tourism, hospitality and part-timers. I will not repeat that; the Committee has listened to me once on those issues and certainly does not need to hear me twice. I just make a small comment on why I am particularly concerned about the approach to small businesses, which is that it seems to me that the Government have put in some protections for what are genuinely micro-businesses but do not use “micro” and instead keep using “small”. The noble Lord, Lord Londesborough, identified the benchmark, which is about seven employees. Then you can start to do better under the changes that the Government have made. However, every time I read about the growth agenda, it requires the upscaling of our small businesses. This, in many ways, has been the British disease.

I was looking at reports from the ScaleUp Institute, which obviously does excellent surveys so you can get a granular feel of what is happening with many of these businesses. Most of them state that the first problem in scaling up is talent, but the second problem is access to finance. For a company that will now have to take on board additional costs—about £1,000 or more per employee—this will exaggerate that problem of access to finance. Many of them will now have to find finance in order to be able to cover the working capital that is engaged in paying higher employers’ national insurance. The noble Lord, Lord Forsyth, in his excellent and interesting Second Reading speech, covered some of the issues associated with that credit.

--- Later in debate ---

[Lord Leigh of Hurley (Con)]

I just ask: what are the Government afraid of? This is a sensible suggestion about assessing what the effect might be of an enormous change to every business and charity organisation in the country. If it is such a good thing—we are told that it is—verify it.

[Baroness Kramer (LD)]

My Lords, I shall be extremely brief. It must be galling for the Minister to sit here and be lectured by the Conservative Benches because he and I so often tried to obtain information and were consistently denied it. The noble Baroness, Lady Noakes, asked why there was not a greater outcry. Everybody just got so used to being denied information.

I am sure that the Minister will also be able to cite many economic crises when information was not provided—I have to say, the silence on the Conservative Benches in not calling out for that information was very loud, if I can put it that way. I am sure that, if the Conservatives were back in government again, we would get the same absence of transparency and limitations on information. There are perhaps two honourable exceptions—the noble Baronesses, Lady Noakes and Lady Neville-Rolfe—who stood out against their party when every other voice was one that co-operated in that silence.

That silence was part of the reason why there was so much mistrust of the Conservative Government in the end; it was part of their undermining. As the Minister and his Government start to look at reform, which they are looking at more generally—particularly in dealing with the Civil Service—looking for opportunities for transparency would be a really positive move. With information, we stand on more secure ground. Will he consider that? I have asked him that before.

It is realistic to understand that we are unlikely to get impact assessments ahead of the actions that the Government contemplate doing in the next few weeks, or just in the next couple of months, but post reviews are at least a place to begin. They shed light, and they help both the Government and Parliament to understand where things have been effective and where they have not. If the Minister feels that he cannot accept these kinds of requests for immediate impact assessments, will he consider seriously the various requests made in other groupings for post-facto analysis and review?